BP to Pay $20.5 Million to Settle U.S. Natural Gas Case

The settlement resolves a long-running lawsuit which alleged that the BP subsidiaries underpaid for natural gas that they extracted on land owned by the U.S. government and Indian reservations.

To settle claims that it cheated the U.S. government and Native Americans out of natural gas royalties, BP has agreed to pay $20.5 million, officials said on Sept. 16.

Six U.S. subsidiaries of BP -- including Amoco, which merged with the British oil major in 1998 -- were parties to the settlement, the U.S. Department of Justice said.

The settlement resolves a long-running lawsuit which alleged that the BP subsidiaries underpaid for natural gas that they extracted on land owned by the U.S. government and Indian reservations.

"Natural gas royalties provide an important source of income for the United States, Native Americans, and various states," said Assistant Attorney General Tony West. "Through cases like this, we are keeping our commitment to protect public lands and to ensure that companies who take non-renewable resources from those lands pay their fair share of royalties."

The U.S. government has collected about $270 million in settlements in similar cases in which various energy companies were accused of shortchanging the government and Indian tribes out of natural gas royalties.

Chevron, ExxonMobil and Royal Dutch Shell have all paid settlements to resolve such lawsuits.

The DoJ said that the settlement explicitly excluded claims against BP arising from last year's devastating oil spill in the Gulf of Mexico.

Copyright Agence France-Presse, 2011

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